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To: Mr_Merck who wrote (54443)	2/10/1999 4:41:00 PM
From: Mr. Big	Respond to of 119973

FGI has everything going for it mentioned above (higher oil prices, over-sold, under valued, triple bottom, mistreated, etc.) along with the other sector stocks. Plus, it has more. This is a company that should continue to add to its considerable backlog for years to come, in spite of a lousy business environment for its customers. Its customers are generally offshore drillers. FGI builds rigs, refurbishes rigs, repairs rigs and does most anything else that has to do with an offshore drilling rig. Rig work, with the exception of new construction, must continue no matter what the level of day rates. Drillers must keep their rigs in good repair to keep them working and competitive. The company has proven itself as being reliable, on time, on budget and customer oriented. A true testament to their dedication to customer satisfaction was demonstrated recently when Noble Drilling (NE) moved one of its EVA semisubmersible conversion jobs from the original shipyard that did the lions share of the conversion work, to FGI for final outfitting. Rig owners don't move rigs around just for fun. The absolute worst thing that can happen to a shipyard job, be it new construction, repair or conversion, is to encounter delivery delays and cost overruns. FGI has demonstrated its reliability in avoiding these taboos. Future customers will be able to place work at FGI with confidence. This alone will be a strong factor in favor of FGI getting more than its share of future rig work. Throw in state-of-the-art construction facilities, a CEO that is as savvy as they come and a short position of 2.82 million shares (as of December 1998), and there is the potential for a strong exit from The Dead Zone. Short position? That's right. A substantial short position, representing 23% of the stock float of 12.3 million shares. (There are 24.5 millions shares outstanding.) Why would anyone short FGI in such a big way? It has hardly any debt. It has a backlog of hundreds of millions of dollars that will maintain earnings visibility for quarters to come. The company likely will continue to add to that backlog in the coming months. About 50% of the stock is closely held by the two original shareholders. The company has a stock buyback program that has brought in about one million shares, and more may be coming. Compare the short position in FGI to that of other oil patch companies with much weaker balance sheets and oodles of debt. No other sector company has near the short position, as a percentage of the float, as does FGI. For example, competitor Halter Marine (HLX) has a short position of 1.03 million shares and a float of 24.3 million shares. Big difference. Who knows the why of the short position, but that it exists could fuel the fire for a sustained upward move for FGI, setting it apart from its sector brethren. biz.yahoo.com